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Quote of the Day

“Recurrent depressions are, then, temporary pauses or retrograde movements in the rising tide of prosperity, and they are of interest mainly to the speculator or trader who is concerned with the ceaseless fluctuations of the market. To the investor, who is interested in the long-term trend, their importance is much less and turns on the time at which he may best buy or sell. “

– Stewart MacDonald, 1928 in Barron’s

Stock investors in the late 1920’s and early 1930’s may have argued with MacDonald’s meaning by “temporary”. Stocks began their fall in 1929 and would fall nearly 90% through 1932. It would take those who invested in the stock market in late 1929 25 YEARS to get back to break even.

This day in 1929 is the anniversary of the start of the major stock decline that would usher in the great depression. Stocks would fall 6+% on this day 1929, they would decline an additional 2% the next before collapsing on “Black Monday”, October 28, 1929 and “Black Tuesday”, October 29th, 1929.

October 23rd – This Day in Stock Market History

October 23rd, 1929 – The Dow Jones Industrial Average falls 6.33%, the first significant decline in what would become the Great Depression.

Unfortunately, it would be just a taste of the pain to come for investors.

The Dow closes the day at 305, already down more than 20% from its high on September 3rd of 381.17, and would fall all the way to a low of 41.22 on July 8th 1932.

We are still 5 days from the famous collapses of “Black Monday” 1929 and “Black Tuesday” 1929 when stocks fell 12.8% one day followed by 11.7% the next, but obviously traders are already on edge with markets already down 20% from their all time highs.

news_headline_of_crash

Source: It Was a Very Good Year: Extraordinary Moments in Stock Market History

Best October 23rd in Dow Jones Industrial Average History

 1933 – Up 5.37%, 4.49 points.

Worst October 23rd in Dow Jones Industrial Average History

1929 – Down 6.33%, 20.66 points.

Read of the Day

For first hand accounts of the panic during the great depression (and other monumental moments in stock market history), check out one of my favorite stock market history books:

Eyewitness to Wall Street: 400 Years of Dreamers, Schemers, Busts and Booms

<-- Go Back One Day: October 22nd - 1962: Cuban missile crisis begins, stocks fall

Go Forward One Day: October 24th - 2008: The VIX hits a record high as financial crisis unfolds -->